Mahindra & Mahindra (M&M) and Hero Electric announced a non-equity collaboration for development, contract manufacturing and joint parts sourcing for electric two-wheelers. For the alliance, Mahindra Group will lend their Pitampur plant in Madhya Pradesh for production of Hero Electric’s electric bikes - Optima & NYX. With this alliance, along with the expansion of its Ludhiana, Punjab facility Hero Electric will be able to meet its demand of manufacturing over 1 million EVs per year by 2022.
Mahindra and Hero Electric will enter into a 5-year contract to enhance the area of coverage of their partnership. Over the contract period, the value of the transaction is expected to be in the range of ₹140 - 150 crore. The joint development endeavors will also be a key factor in the electrification of the Peugeot Motocycles’ portfolio. Peugeot Motocycles is a French manufacturer of scooters and small motorcycles. It is expected to bring considerable value to both parties through optimization of cost, timelines, and shared knowledge.
Hero Electric aims to utilize Mahindra Group’s powerful supply chain to reach newer centers in the country. The commitment of both companies towards R&D for electric vehicles will not only further the development of electric vehicles but also foster a culture where EV players work together.